Deputy Commissioner Lockhart: Delays in Strengthening
Social Security Mean More Difficult Choices in the Future
James B. Lockhart, the Deputy Commissioner of Social Security,
stressed the need to strengthen Social Security in comments to the
Fifth Annual Retirement Research Conference at the National Press
Club. "The sooner we address the problem, the less abrupt the changes
will have to be," said Lockhart.
Lockhart’s presentation showed that Social Security’s current pay-as-you-go
system is unsustainable because of the aging of America’s population,
and that the tax increases or benefit reductions needed to maintain Social
Security’s solvency rise with each year that action is delayed.
To keep Social Security solvent over the next 75 years would require
a 15 percent payroll tax increase if action were taken today. Delaying
action until 2018 would mean a tax increase of 22 percent, and waiting
until 2042 the payroll tax increase would rise to 45 percent above today’s
Likewise, to keep Social Security solvent over the next 75 years by reducing
benefits would require a 13 percent cut today, but the reduction would
increase to 16 percent if action were delayed until 2018, and 31 percent
if delayed until 2042.
Lockhart said, "The unattractiveness of relying exclusively on tax
increases and benefit reductions to bring Social Security into balance
has led some Republicans and Democrats to turn to options like personal
accounts that could improve the rate of return on Social Security contributions."
On March 17, upon the release of the 2003 Social
Security Trustees Report, President Bush said, "I hope that Members
of Congress will join with the Social Security Administration and other
interested parties in a national dialogue about how to best strengthen
and protect Social Security." Lockhart stressed that the Social Security
Administration will work with Members of Congress of both political parties
to further bipartisan efforts to strengthen Social Security for future
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